Page 132 - CW E-Magazine (30-7-2024)

Point of View

and gloves (which came in handy at the time of Covid) to automobile parts, food flavours and fragrances. The co-location of a terminal
to import liquefied natural gas (LNG), to meet the energy needs of the cluster (and beyond), as well as the ‘on-demand’ supply of other
utilities (steam, water, industrial gases) as well as waste management facilities, have all contributed significantly to the efficiency of
manufacturing operations in the cluster. Tucked away in a corner of a densely populated country, Jurong Island has had an impressive
record of safety – a point that planners in India will do well to note.

Tackling the sustainability challenges
Responding to the needs to tackle climate change, and to comply with international regulations, Singapore’s manufacturing sector
is required to transition to a low-carbon base. Give that the chemical industry is a significant contributor to carbon emissions and its
importance to Singapore’s manufacturing, pivoting this industry to a more sustainable growth path is vital to meet national commitments.

The objective is to quadruple the production of sustainable products from the 2019 levels, and achieve 6-mtpa of carbon reduction
through low-carbon solutions by 2050. The Economic Development Board (EDB), which has strategized the growth of the economy
through astute planning for several decades now, is expected by 2030 to establish specific targets to transform Jurong Island into a
sustainable energy and chemicals (E&C) park. The EDB has awarded S$55-mn to 12 projects under its Low-Carbon Energy Research
Funding initiative to support R&D in this space.

Achieving net-zero by or around mid-century, however, won’t be easy. Nearly 95% of Singapore’s energy now comes from natural
gas, according to the Energy Market Authority (EMA), and the options for developing more in-country renewables capacity are limited,
particularly given the paucity of land. Much of the natural gas has come from neighbouring Indonesia and Malaysia (though recently
it has been supplanted by LNG imports from further), but since last year Singapore has also been importing electricity.

Key role for hydrogen
Given the limited options available, Singapore is betting a lot on green hydrogen, produced by the electrolysis of water using
renewable energy. The country’s National Hydrogen Strategy is emphasising use of green ammonia – a logistically safer and easier-to-
handle carrier of hydrogen – as a fuel for marine transport as well as a source of low- or nil-carbon electricity (when burned in
specially modified engines). International partnerships, local technology development efforts and long-term planning are being put in
place for hydrogen to play a much larger role in Singapore’s future energy scenario.

Improving resource efficiency and productivity
There is a lot of emphasis on improving resource use – not surprising for a country with limited natural resources. The country
today leads in efficient water management and famously recycles municipal sewage back to potable water. Manufacturing companies
are also required to assess and account for their water use and to identify, plan and implement measures to achieve water savings
through systematic management of the resource.

About five years ago Singapore also introduced a carbon tax scheme, aiming to incentivise emissions reduction while allowing
flexibility for cost-effective actions. Over the next decade, the carbon tax will gradually increase towards $50-80 per ton CO e (carbon
2
dioxide equivalent). Companies are also looking to using Renewable Energy Certificates to fulfil their renewable energy and sustain-
ability obligations. Productivity improvement initiatives in the industry, are calibrating the productivity of companies in Singapore
against international benchmarks and facilitating identification of enhancement opportunities.

Several advantages
Amidst extreme commodity price volatility, looming uncertainties in the global economy, oversupply in most chemical value chains
and the challenges posed by a transition to a low-carbon world, Singapore’s government has invested heavily in public and private
research infrastructure, and skill building.

With strong logistics capabilities, regional connectivity, and comprehensive free trade agreements its over-sized role in chemicals
trade will continue. At the epicentre of the Asia-Pacific, the country is well poised to leverage the exceptionally positive demographic
fundamentals of the region, which is expected to stay the main driver of chemical demand well into the future.
Ravi Raghavan

132 Chemical Weekly July 30, 2024

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